Tag: Fair Labor Standards Act

THIRD CIRCUIT RULES TRUCK DRIVERS IN FRACKING INDUSTRY NOT EXEMPT FROM OVERTIME

The Third Circuit recently affirmed the decision of the district court which found that defendants, Fast Rig Support, LLC and First Americans Shipping and Trucking, Inc., did not prove that its truck drivers were exempt from overtime compensation under the FLSA and Pennsylvania state law.

The plaintiffs were truck drivers that transported water to hydraulic fracking sites within Pennsylvania and were paid overtime for work performed in excess of 45 hours per week.  Plaintiffs argued that this practice violated federal and state wage and hours laws because they were not paid overtime for work over 40 hours per week.  Defendants argued that plaintiffs were exempt from overtime under the motor carrier exemption, which exempts certain truck drivers from receiving overtime pay if certain criterion is met.  One such criterion is that the driver must transport property through interstate commerce, that is, across state or international lines.  Even when transportation takes places within one single state, however, the interstate commerce requirement may still be met if the employee’s work involves a practical continuity of movement across state lines.

In this case, defendants argued that the after fracking is completed, they are occasionally hired to transport the water used in the fracking process to injection wells for disposal.  The Third Circuit, however, ruled that defendants did not meet their burden to prove that the drivers’ transportation of water involved a continuous stream of interstate travel.

Although defendants produced three pieces of evidence, the court did not find it adequate because it did not show whether drivers actually drove across state lines or whether the water drivers actually transported was out of state.  The court explained that “the relationship between defendants, the fracking companies, and the movement of wastewater out of the state could theoretically be one involving a practical continuity of movement in interstate commerce, depending on…the intent of the shipper at the time shipment commenced, the role defendants’ drivers played, whether the water is altered during the fracking process, and the steps for water removal and outgoing transportation,” but defendants produced no evidence concerning these matters.  Thus, the court held that defendants did not meet their burden to show that the motor carrier exemption applies, and affirmed the judgment of the district court.

SECOND CIRCUIT RULES IN FAVOR OF APPLEBEE’S RESTAURANT WORKERS IN WAGE-AND-HOUR SUIT

In 2010, workers at Applebee’s restaurants located in New York sued franchisee owner, T.L Cannon Corp. (“Cannon”), for alleged violations of the Fair Labor Standards Act and New York Labor Law. Specifically, Plaintiffs claimed that Cannon failed to pay hourly employees an extra hour of pay when working a ten-hour workday pursuant to state regulations and also required managers to subtract pay for rest breaks they did not actually take. Plaintiffs moved for class certification on both claims. The district court, relying upon a misreading of the Supreme Court case, Comcast Corp. v. Behrend, found that since damages were not measurable on a class-wide basis, Plaintiffs motion for class certification must be denied. The district court construed Comcast as holding that the failure to offer a damages model that is susceptible of measurement across the entire class is fatal to the class certification question.

Plaintiffs appealed the lower court’s decision. Yesterday, the United States Court of Appeals for the Second Circuit vacated and remanded the order of the district court. The Second Circuit found that the lower court misinterpreted the Comcast decision when it denied class certification to Plaintiffs solely based on the damages issue and ruled that individualized damages determinations alone cannot preclude class certification. The case will now return to the district court, which will decide whether to certify the class based on the proper standards.

The case is titled Roach v. T.L. Cannon Corp., and the full decision can be read here.